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Determinants of Firm Value in Kenya: Case of Commercial Banks Listed at the Nairobi Securities Exchange

Applied Finance and Accounting

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Field Value
 
Title Determinants of Firm Value in Kenya: Case of Commercial Banks Listed at the Nairobi Securities Exchange
 
Creator Ayako, Aloys
Wamalwa, Fidelis
 
Description This study analysed the determinants of firm value of commercial banks listed at the Nairobi Securities Exchange (NSE). The analysis was based on secondary panel data over the period 2002 to 2012. The estimation results of the random effects regression model showed that, though statistically significant (p<0.05), the joint effects of the determinants under the study was low, accounting for about 30  per cent of the variance of the firm value of the listed commercial banks in Kenya. At the individual determinant level, the estimation results were mixed. While we could not reject the null hypotheses that assets, capital structure, cash flows, dividend ratio and intangible had no statistically significant individual effects on the firm value of the listed commercial banks (p<0.05), we rejected the null hypotheses and concluded that market capitalization had statistically significant individual effects on the firm value of the listed commercial banks (p<0.05). Given the relatively low joint effects of the determinants under the study, we recommends that further studies should be undertaken to identify and include additional firm specific and both industry level and macroeconomic control variables. The studies should also evaluate the effects of alternative computation of firm value on the model estimation results. The studies may focus on firm value of the listed commercial banks and/or other listed firms in the NSE
 
Publisher Redfame publishing
 
Contributor —
 
Date 2015-07-07
 
Type info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion
Peer-reviewed Article
 
Format application/pdf
 
Identifier http://redfame.com/journal/index.php/afa/article/view/934
10.11114/afa.v1i2.934
 
Source Applied Finance and Accounting; Vol 1, No 2 (2015); 129-142
2374-2429
2374-2410
 
Language eng
 
Relation http://redfame.com/journal/index.php/afa/article/view/934/910